Agreed.

Some people seek fun on these games, not stressful content. An awesome raid system reference is Dragonica...it's pretty much what OP suggested...it has scalling difficulty in exchange for a much superior loot or, at least, different loot. By the system they use there would be like you having an AF piece dropping exclusively from a certain difficulty level...so if the player want to solo his entire AF he will need to subdue the raid with overleveling, actually losing the optimal experience and level for the loot (exactly like happened to Toto-rak here...you can solo it at 50...but the overall gaming experience and loot usefulness will be damaged). Also, they added there a evaluation system based on intented performance there...so if the dude is too low or too high for that content he might not have access to full reward.

IMO that's a good way of dealing with different groups of players, giving support from solo to party, from casual to hardcore. It's all about player skill and playstyle there.